Our Investment in a Fair, Intelligent, and Customizable Alternative Trading System – OneChronos

- Artificial intelligence-powered auctions to optimize financial trading

By Brent MacDonald – Partner at Rising Tide

In the U.S. alone, over $250 billion of equities trade every day (WSJ). OneChronos is building a financial exchange that dramatically reduces the costs and complexities of trading. Additionally, the Company’s novel auction-matching system is disrupting the archaic continuous limit-order book system of executing trades. The technology uses atomic clocks to circumvent the need for the low latency infrastructure that High-Frequency Traders (HFT) pay millions of dollars for. Optimized auctions and traders’ ability to run code on the exchange make for better order fills and higher precision trades.

The OneChronos team has now launched the first ‘Smart Market’ ATS solution for equities trading, powered by combinatorial auctions, which allow participants to input several parameters around their orders, seeking truer outcomes while mitigating many of the issues that have long frustrated traders using more traditional approaches. Smart Market is the technical term for markets that match counterparties using mathematical optimization.

Today, OneChronos is now deploying points of presence (POPs) for order entry and market data distribution around the globe. Its order entry paradigm and distributed systems IP use high-precision timestamping to render competition over proximity, network routes, and market data handling moot. This also allows for combinatorial trading across all geographies and asset classes.

Along with plans to expand its pan-European equities trading business, OneChronos also announced the formation of "OneChronos Labs," an independent group of eminent academics and industry practitioners focused on the multidisciplinary problem of bringing transformative auction formats to capital markets. OneChronos announced the completion of its Series B investment round of $40 million in 2023. With these funds the Company plans to expand to bring its technology to other geographies and asset classes. Find the funding press release here.

Why We Are Excited:

By creating and running matching markets that take advantage of developments in auction theory and artificial intelligence, OneChronos, a technology company comprised of diverse thinkers, is aiming to increase the world GDP. It innovates at the intersection of capital markets, mechanism design, and operations research.

With BMO, Jefferies Financial Group, and other elite broker-dealers joining the OneChronos platform, the Company is one of the fastest-growing automated trading systems (ATSs). OneChronos has so far facilitated more than $60 billion in institutional securities transactions. We at Rising Tide are excited to work with the OneChronos team to help them become the industry leader as they continue to find innovative solutions to the special problems associated with running high-speed smart markets.

Disclaimer: Rising Tide Fund Managers, LLC and its affiliates (“Rising Tide” or “We”) is a United States venture capital firm investing primarily in the information technology and healthcare/life sciences markets. Over the last 35 years, we have partnered with family funds, high-impact investors, and strategic partners to help launch and expand startups in a variety of industries across three continents. We are dedicated to cooperating with our entrepreneurs at all stages: from financing to leveraging our international networks to facilitating exits by design. The portfolio companies described herein do not represent all the portfolio companies purchased, sold, or recommended for portfolios advised by Rising Tide. The reader should not assume that an investment in the portfolio companies identified were or will be profitable. Past performance is not indicative of future results. Investors should be aware that a loss of investment is possible. For more information, visit www.rtf.vc